Determinants of companies' commitment to climate change: Evidence based on European listed companies

Climate change is a highly topical issue, and companies are increasingly required to report on their climate actions. This study assesses the influence of several factors affecting the companies' commitment towards climate change mitigation, adaptation, and transparency (i.e. CDP Integrated Performance Score). Therefore, by analysing the determinants of climate change commitment, the research aims to provide evidence and further insights on companies' responsiveness to climate challenges. Data are collected from Bloomberg's ESG database, and multiple linear regression analysis is performed on a sample of 3000 European-listed companies responding to the carbon disclosure project (CDP) questionnaire. The results show that CDP IntegratedPerformance Score is associated with greenhouse gas emissions disclosure, GlobalReporting Initiative (GRI) compliance, the presence of a Corporate Social Responsibility (CSR) committee and women on board, the number of employees, board and firm size. By contrast, assurance and ROE are non-significant determinants for our sample. This study contributes to the existing research on climate change disclosure providing further insights on companies' climate change action. The findings are valuable for managers and regulators in promoting sustainability strategies and improving environmental performance and climate transparency.